Tuesday, December 14, 2010

Confederacy of economic dunces

Inside Job

I particularly liked the fact that the filmmakers touched on the intellectual underpinnings of the crisis, in the Accountability section. Being frustrated at the sorry state of the economics discipline has been a hobby of mine for years, and while delving into it was outside the scope of the film, it was important that the filmmakers noted the connection between financial interests and the economic school of thought that gets funded in universities. The result is that the only worthwhile economics faculty in the country is at the University of Missouri-Kansas City, and every other economics department is fully in the grip of the neoclassical school. (The Post-Autistic Economics movement started in France, and so I hope that Europe is a little better.) This academic support of powerful economic interests goes back a while - the neoclassical school itself, from what I understand, broke away from the classical school because the classical school had taken a sharp turn to the left with Marx... and so the economists he called "sycophants of capital" turned toward focusing exclusively on mathematical abstractions about the economy and away from real world observation and analysis. (These mathematical abstractions all tended to show how swimmingly everything in capitalism went without government interference.) Anyhow, fast forward a hundred years and the tenuous relationship between economics and the actual economy has allowed a situation where politicians from Reagan to Obama can (in good faith, no doubt) listen to economic advisers who tell them (in good faith, no doubt) to adopt policies that will benefit only the very richest while impoverishing the rest. It's an infuriatingly frustrating situation - it's like if Freudian theory was the dominant paradigm in psychology, and whenever you went to see a psychologist s/he would tell you that all of your problems stem from Oedipal and Electra complexes and penis envy and whatever other creative rubbish came out of one man's imagination. Thankfully, the movie was pretty funny at times, and the absurdity of the whole situation does at least allow for a lot of humor, like this video making fun of the ridiculousness of (neoclassical) economic theory:

Tuesday, December 07, 2010

If only the Nazis had believed in theoclassical economics...

The Economic History of Germany

I love how deftly the authors avoid the conclusion that the heavy-government-intervention economic policies of the Nazis actually did achieve impressive results (viewed from a purely economic perspective, of course). Like with this Zen shit: "Often the apparent successes of such economies are just illusions. Outsiders who do not know how such economies really work are often fooled by these illusions." Yeah, the "outsiders who do not know how such economies really work" - comprising the entire European continent plus Russia - were pretty fucking fooled by the illusory successes of the German military, fueled as it was by the German economy, which of course was successful only in an illusory sense. If only Europeans and Russians during the war could have had the Zen consciousness of this article's author, they could have realized that the German war machine hadn't in fact decimated their homelands, because it was based on an illiberal economic system which can only ever boast of "illusory" successes.

Also, I love the fantasy-economic determinism of the author - as if the only independent variable on economic success is whether or not a liberal economic system is in place. So after the war, "near-famine" conditions were "[t]he net result" of government interference in the economy. (Or 'government molestation of the sacrosanct free market', to put it in terms more in keeping with the spirit of theoclassical economics.) Externalities - like the utter devastation of the country by years of carpet bombing, or the deaths of millions upon millions of citizens - are irrelevant. Hahahahahahaha!

Friday, December 03, 2010


Unemployment rate rises to 9.8 percent by Ben White

Fuck Our Lives. Of course, it's 9.8 percent measured the way we measure it now, after many rounds of statistical gerrymandering to lower the figure. If we measured unemployment the way it was measured thirty years ago, it would be double what it is now. Worst of all, the "ideas" this stat evokes in what passes for political discourse in the U.S. do not include actual job-creating programs.

I had always wondered how people could have been so retarded as to, say, worship a man as a living god, or engage in public ceremonies of self-flagellation... but this is helping me understand that human stupidity should never be underestimated. Thanks, Darrell Issa, for teaching me a lesson.